The Central Bank allowed rescheduling of loans of many big business houses under special provision in 2015 due to escalating political turmoil. At the time, 11 industrial groups got their loans rescheduled amounting to Tk 15,218 crore while Beximco Group’s loans alone stood at around Tk 5,000 crore. Repayment of the rescheduled loans began from last December but Chittagong-based SA Group and Narayanganj-based BR Spinning have made no repayments at all. Ratanpur Group has paid half of the installments and others are now showing no interest for repaying the March installment. The conglomerates have asked for extension of repayment period from 12 years to 20 years. They demanded that no fresh interest can be imposed; more time to be given to repaying the first installment on the existing loan and fresh working capital must be given to them.
As the Bangladesh Bank awarded the concessional policies to those companies having loans above Tk 500 crore, 80 borrowers with loans lower than Tk 500 crore approached the court for rescheduling of their loans. Centering the loan rescheduling, the banking sector has entangled in a growing anarchy while ordinary people have to pay more tax to supply new blood to enlivening the ill banks. The anarchy in the banking sector has already struck the economy and such tolerance to loan defaulters is encouraging others to become defaulter. Bankers even collaborate in many cases with companies for not repaying installment despite rescheduling.
As per available data, the default loans stood at Tk 63,300 crore at the end of June last year and currently the amount is even bigger. The inability of some large borrowers to pay installments regularly despite taking the advantage is posing a big threat to the sustainability of the banking sector. Banks can resorts to Bankruptcy Act 1997 against big defaulters but it is not politically workable and so default loans are spilling over as new loans are mooted out to faulty clients. We must say banks must be allowed to work on corporate basis while undue political influence must keep away from it.
Bad management of the country’s economy must also be considered before condemning and making life of the loan defaulters miserable.
